Head teachers say massive problems are looming in the funding of England's schools to dwarf the crisis that has led some to threaten staff redundancies this year.

They say there is a £2.5bn "black hole" in the budget over the next two years - which could also wreck the deal on reducing teachers' workloads.

Heads were led to believe they would get more, union says

And leaders of the National Association of Head Teachers (NAHT) have dismissed as a "smokescreen" new government figures showing that education authorities have not yet allocated at least £590m this year.

The government is giving authorities 10 days to explain the breakdown of their finances, and says it wants to work with them to avoid "needless" redundancies.

It stresses it is not "naming and shaming" anyone but questions whether schools realise the amounts that might still be coming to them later in the year.

'Questions to be asked'

The sums vary - depending on the size of the authority for one thing - with two councils not having allocated more than £20m apiece.

Officials at the Department for Education accept there might be good reasons for the money being held back.

But they say that, now that the local elections are out of the way and the figures are public, schools can begin to question what is going on.

They believe that process will resolve the difficulties this year.

NAHT leader David Hart said there were no "hidden pockets" of cash

The NAHT's general secretary, David Hart, said he didn't think there were any "hidden pockets" of money that were going to emerge from the government's questions to councils.

But, having done its own calculations, his union argues that the government miscalculated the impact of extra costs this year from such things as increases in teachers' and assistants' pay, pension and National Insurance contributions.

"Far from there being a quarter of a billion pounds of cash to spare, we are nationally in debt - we are in the red to the tune of more than £250m."

HEAD TEACHERS' SURVEY

Almost 17% of schools had a cash decrease

More than a quarter got less than a 5% rise

Only 22% have 10% or more - the amount needed to meet increased costs

Source: NAHT survey of more than 700 schools in 136 areas

But worse was to come - because the funding settlement announced by the chancellor last summer was for three years.

In the agreement on reducing teachers' workloads by employing more assistants and giving them guaranteed time off for such things as lesson preparation, ministers had said there would be £3bn extra by 2005/06.

"It is our view that the figure of £3bn is considerably over-inflated and that the real figure is of the order of £500m."

His union had signed the deal on the understanding that the necessary resources would be forthcoming.

"Clearly, that condition has not been met."

It would be "disastrous" for schools and the government if it tried to "trumpet" having an agreement when it was clearly failing, heading towards the next general election, he said.

The shadow education secretary, Damian Green, said: "This latest attempt at passing the buck for the schools' funding crisis to local government does not survive the most cursory examination.

"Why are teachers facing redundancy in the many local authorities the government has not mentioned, if this is not a national crisis?

'Shoddy and misleading'

"Charles Clarke should now open the Department for Education's own books to an independent audit, so that we can see how much extra is being spent on bureaucracy.

"There are 25% more education bureaucrats in post than when Labour came to power. It is no wonder that too much taxpayers' money is not reaching our schools."

Liberal Democrat education spokesman Phil Willis added: "This is a poor attempt by the government to lay all the blame at the door of the LEAs. Charles Clarke has now lost the trust of both teachers and their employers.

"This crisis has been caused by a lack of joined-up central government.

"Schools have had to cope with rises to National Insurance, teachers' pay and pensions as well as changes to local government finance - all of which came into force at the same time.

"The consequences of this hasty implementation is now clear.

"The education secretary should have questioned the LEAs about their spending decisions and their impact on schools before he released this shoddy and misleading analysis.

"That would have been the action of an education secretary with the best interests of schools and pupils at heart. Instead Charles Clarke acted in the best interest of the government, by swiftly passing the buck to the LEAs."

The table below shows three key figures from the data published by the Department for Education:

How much of the money intended for the schools budget has been passed on - most authorities put in council tax money, so give more than they are expected to.

The difference between the increases for schools and the increase for LEA central services. The government argues that a positive figure shows councils have placed a greater priority on devolving money to schools.

Funding that is supposed to be devolved but has not yet been allocated - totalling £532.9m nationally.